Macquarie, Alinda dominate fundraising in 2009

Nearly 50% of the $10.7bn raised by infrastructure funds in 2009 went to the two firms, according to a tally of fund commitments compiled by San Francisco-based placement agent Probitas Partners. The $10.7bn total was also 57% less than the $24.7bn raised by infrastructure funds in 2008.

Infrastructure investors rounded out 2009 with $10.7 billion in commitments, or about 57 percent less than the total capital raised for the asset class in all of 2008, according to data compiled by San Francisco-based placement agent Probitas Partners.

The fundraising was also far more concentrated among a select few winners, with New York-based Alinda Capital Partners attracting $2.5 billion, or 23 percent of the total for its second fund, and Australia’s Macquarie Group scooping up $2.6 billion, or 24 percent of the total, across four funds in market, according to the data.

Infrastructure fundraising in 2009: down but not out
Source: Probitas Partners

In November, for example, both firms won commitments of $40 million each from a pool of 30 funds-in-market vying for fund capital from the $12 billion State Universities Retirement System of Illinois. Alinda also won the only infrastructure commitment awarded by the $206 billion California Public Employees’ Retirement System, at $300 million.

Alinda’s and Macquarie’s fundraising success was a rarity: overall, as nearly 100 funds worldwide vied for approximately $110 billion of infrastructure capital, few fund managers were likely to be thrilled with their $10.7 billion fundraising take-ins for the year.

In 2008, by contrast, Probitas estimated a total of $24.7 billion in global fundraising for infrastructure, which has typically attracted investors like pensions, insurance firms and endowments.

“Infrastructure was certainly down in 2009, but it was not a secular problem with infrastructure. Every market within private equity was down with the sole exception of secondaries,” said Kelly DePonte, a partner at Probitas Partners, who compiled the figures. The figures exclude funds that Probitas is currently placing.

Infrastructure fundraising turned out to be a roller-coaster throughout the year. About $1.6 billion was raised in the first quarter of 2009, followed by $2.4 in the second quarter. The third quarter saw a downturn to $1.3 billion, followed by a rally of $5.4 billion in the fourth quarter, according to Probitas’ data.

DePonte credits the fourth quarter uptick to rising stock market, which gave some investors confidence. He cautioned, though, the fear of a double-dip in the market is still making many investors weary about putting their money into any illiquid asset class like infrastructure or private equity.

“There’s a lot of real hesitation around that issue,” said DePonte.